The Problem Real Madrid Has With Ronaldo’s Wage Demands

byDavidonSeptember 4, 2012

Jorge Mendes has confirmed his lack of surprise for and total support of Cristiano Ronaldo’s statements claiming he was sad at Real Madrid.

Mendes, who is also Jose Mourinho’s agent, was reported in some sections of the press to have been caught off guard by his client’s words, but through a statement released yesterday afternoon via his company’s website, the agent has responded.

“Regarding the reports published today that claimed that I was surprised and felt uncomfortable by the statements uttered by Cristiano Ronaldo, I would like to clarify,” began the posting.

“Cristiano Ronaldo’s statements are based on reasons that are of my knowledge, it is the sole discretion of Cristiano Ronaldo to disclose those reasons or not.

“These statements are not a surprise nor a discomfort to me. Whoever knows the relationship I have with Cristiano Ronaldo will also know that he will always have my full support.”

Don’t be fooled by all the noise that Ronaldo does not feel loved and respected by his team mates, the club and the fans. This s ultimately about money.

Ronaldo wants to be the highest paid player in the world, and with just under three years left on his current deal, this is the time that contract negotiations begin. Ronaldo’s statement is the first move in that negotiation.

Ronaldo signed a six year deal with Real Madrid when he moved from Manchester United that pays him £9.6m which is the same as Kaka. That translates to about £7.2m net after tax.

Since he signed that deal, Samuel Eto’o, Wayne Rooney, Robin van Persie, Carlos Tevez, Yaya Toure and Zlatan Ibrahimovic have all signed bigger deals than Ronaldo’s.

Reports out of Spain say that Ronaldo wants a pay increase to £12m net a year. Even under existing Spanish tax rules, that would mean £14.5m a year gross wages. Which is not unreasonable.

The problem for Real Madrid is that, in two years’ time, the “Beckham tax loophole” ends, which means that Ronaldo’s tax rate will jump from 24% to 52% per cent.

So to get to the same £12m after tax wages, Real Madrid will have to pay Ronaldo almost £25m a year, or £480,000 a WEEK. I am not sure that even a club as wealthy as Real Madrid can pay a player that kind of money, especially with Uefa’s Financial Fair Rules coming into effect.

And this is not just a Ronaldo/Real Madrid issue. Barcelona are getting ready to start to negotiate a new deal with Lionel Messi, and they will face the same issue. In two years, Lionel Messi’s wages will more than double due to the increase in the tax rate before they work out how to pay him more. Can Barcelona afford to pay Messi almost £25m a year? I am not so sure they can either. Which means that the contract talks for the two best players in the world will be very interesting to watch as the ramifications are huge if they cannot afford to meet their wage demands.